National Newspaper Association

Unsavory competition

September 19, 2012

The newspaper business has been hit this past month with a plan by the United States Postal Service to entice advertising to a major national USPS-favored advertising firm, Valassis, which bought the direct mail firm ADVO in 2006. Valassis is receiving favorable postage rates to the detriment of both first class postal customers, small business and newspapers.

The USPS is trying to create more advertising mail to counter its deficits. To newspapers, who need such advertising to pay for reporters and coverage, and their readers who depend on it, this is beyond alarming.

It will help push more newspapers, already made fragile by the economy and the Internet, over the edge.

Communities across the country will feel the most long-term harm, as many already have.

Now the Postal Service wants to pick the winners and losers. It is providing postage rebates to Valassis of more than 30 percent if the mailer can divert more advertising inserts to direct mail. This will also increase mailbox stuffing, which often gobbles up legitimate first class letters in its folds in crowded boxes.

Small retailers and services don’t have access to these discounts, giving an advantage to their large nation-wide competitors.

USPS isn’t a business. It is a service owned by Uncle Sam since the creation of our nation, to serve all. It should deliver the mail that exists, promptly and affordably for all, without taking business away from firms that are the backbone of the community by the use of its monopoly powers. Congress should put its foot down on this practice.